The country’s leading IT services, consulting and business solutions firm, Tata Consultancy Services is planning to explore the Legal Process Outsourcing (LPO) market. The company has infact already begun the LPO services on a smaller scale with very few clients.
The country’s leading IT services, consulting and business solutions firm, Tata Consultancy Services is planning to explore the Legal Process Outsourcing (LPO) market. The company has infact already begun the LPO services on a smaller scale with very few clients.
TCS is hoping to compete with its business rivals Infosys and Wipro who already have a share in the multi-billion LPO market. TCS has also started hiring both in India and UK, for this practice.
“It (the legal process outsourcing segment) seems like an interesting space…we are currently looking at it,” the TCS Chief Executive Officer and Managing Director, Mr N Chandrasekaran, told Hindu.
TCS has been active in providing technology solutions to law firms globally. Earlier this year, the Law Society of England and Wales selected TCS’s flagship legal management solution as part of a systems development project.
India is the outsourcing market of choice for the U.S. and U.K. The Indian LPO space is controlled by exclusive LPO service providers such as Pangea3, CPA Global, Unitedlex, Integreon and Evalueserve. These LPOs are considered large (with a lawyer headcount of over 500). There are other niche firms like Cobra and SDD, with headcounts of about 100.
Pangea 3 which was recently acquired by Thomson Reuters, is on a hiring spree and plans to double its head count by hiring around 700 people this year to cater to the demand of increased services. The majority of the hirings will be at its Mumbai and Noida centres.
Some of these LPOs have been growing at over 100 per cent in the last few years primarily because they charge a fraction of the $150-350 an hour billed by an attorney in major markets such as the US and the UK.
According to a Nasscom market intelligence report, the LPO segment is expected to touch $15 billion by 2015.
Apart from LPO service providers, the major companies that started LPO services few years back include Bangalore-based Infosys and Wipro. Wipro and Infosys have been actively pursuing opportunities in the LPO space for the last few years now.
Infosys LPO engagements account for 60 per cent of the total knowledge services business, with over 500 professionals and Rs. 70 crore ($15 million) in annual revenue. Bulk of the work is done from Pune (about 400 professionals), followed by Bangalore (80-100 professionals) and Gurgaon (about 20 professionals). The company also expects to start LPO service delivery from Manila, Philippines, by the end of 2011, according to media reports.
In June last year, Wipro’s BPO arm partnered with Microsoft Corporation to provide global legal process outsourcing for Microsoft’s Intellectual Property (IP) portfolio.
TCS’s back-office business, which includes its LPO initiatives, generated revenues of Rs. 10,157 crore ($2.1 billion) for the quarter ended March 31, according to Hindu .
It appears that the LPO sector will continue to grow, going by the current shift in the demands of the market. There are still very few offshore legal service providers that provide specialised high end legal services. Once this trend of specialised high-end legal outsourcing gains more pace, greater amount and variety of legal work will be outsourced.